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Johnson & Johnson Reports Q3 2023 Results

10/17/2023
  • 2023 Third-Quarter reported sales growth of 6.8% to $21.4 Billion with operational growth of 6.4%* and adjusted operational growth of 4.9%*. Operational growth excluding COVID-19 Vaccine of 9.0%*
  • Earnings per share (EPS) of $1.69 increasing 4.3% and adjusted EPS of $2.66 increasing by 19.3%*
  • Company is increasing 2023 full-year guidance midpoints for sales5 and adjusted EPS

Johnson & Johnson (NYSE: JNJ) today announced results for third-quarter 2023. “Johnson & Johnson delivered strong results and significant pipeline advances in the third quarter, providing a solid foundation for future sustained growth,” said Joaquin Duato, Chairman of the Board and Chief Executive Officer. “With a sharpened focus on Innovative Medicine and MedTech solutions, Johnson & Johnson is innovating across the spectrum of healthcare and is poised to deliver the medical breakthroughs of tomorrow.”

Unless otherwise noted, the financial results and earnings guidance included below reflect the continuing operations of Johnson & Johnson. The Company recognized a one-time, non-cash gain of approximately $21 billion in the quarter as part of discontinued operations related to the final separation of its Consumer Health business.

Overall Financial Results

 

Q3

($ in millions, except EPS)

2023

2022

% Change

Reported Sales

$21,351

$19,996

6.8

%

Net Earnings

$4,309

$4,310

0.0

%

EPS (diluted)

$1.69

$1.62

4.3

%

 

 

 

 

 

Q3

Non-GAAP* ($ in Millions, except EPS)

2023

2022

% Change

Operational Sales1,2

 

 

6.4

%

Adjusted Operational Sales1,3

 

 

4.9

%

Adjusted Net Earnings1,4

$6,777

$5,938

14.1

%

Adjusted EPS (diluted)1,4

$2.66

$2.23

19.3

%

1

Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures included in accompanying schedules

2

Excludes the impact of translational currency

3

Excludes the net impact of acquisitions and divestitures and translational currency

4

Excludes intangible amortization expense and special items

5

Excludes COVID-19 Vaccine



Note: Values may have been rounded

Regional Sales Results

Q3

 

 

% Change

($ in Millions)

2023

2022

Reported

Operational1,2

Currency

Adjusted
Operational1,3

U.S.

$11,996

$10,794

11.1%

11.1

-

8.9

International

9,355

9,202

1.6

0.7

0.9

0.3

Worldwide

$21,351

$19,996

6.8%

6.4

0.4

4.9

1

Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures included in accompanying schedules

2

Excludes the impact of translational currency

3

Excludes the net impact of acquisitions and divestitures and translational currency



Note: Values may have been rounded

Segment Sales Results

Q3

 

 

% Change

($ in Millions)

2023

2022

Reported

Operational1,2

Currency

Adjusted
Operational1,3

Innovative Medicine

$13,893

$13,214

5.1%

4.3

0.8

4.4

MedTech

7,458

6,782

10.0

10.4

(0.4)

6.0

Worldwide

$21,351

$19,996

6.8%

6.4

0.4

4.9

1

Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures included in accompanying schedules

2

Excludes the impact of translational currency

3

Excludes the net impact of acquisitions and divestitures and translational currency



Note: The Innovative Medicine segment was previously referred to as the Pharmaceutical segment



Values may have been rounded

Third Quarter 2023 Segment Commentary:

Adjusted operational sales* reflected below excludes the net impact of acquisitions and divestitures and translational currency.

Innovative Medicine

Innovative Medicine worldwide adjusted operational sales grew 4.4%*. Excluding the COVID-19 Vaccine, operational sales grew 8.2%*. Growth was driven by DARZALEX (daratumumab), ERLEADA (apalutamide), Other Oncology, and CARVYKTI (ciltacabtagene autoleucel) in Oncology, STELARA (ustekinumab), TREMFYA (guselkumab), and SIMPONI/SIMPONI ARIA (golimumab) in Immunology, SPRAVATO (esketamine) in Neuroscience, and UPTRAVI (selexipag) in Pulmonary Hypertension. Growth was partially offset by COVID-19 Vaccine (Ad26.COV2.S) in Infectious Diseases, ZYTIGA (abiraterone acetate) and IMBRUVICA (ibrutinib) in Oncology, and REMICADE (infliximab) in Immunology.

MedTech

MedTech worldwide adjusted operational sales grew 6.0%*, driven primarily by electrophysiology products in Interventional Solutions, wound closure products in General Surgery, contact lenses in Vision, and biosurgery in Advanced Surgery. MedTech worldwide operational sales grew 10.4%*, with the acquisition of Abiomed contributing 4.6%.

Notable New Announcements in the Quarter:

The information contained in this section should be read together with Johnson & Johnson’s other disclosures filed with the Securities and Exchange Commission, including its Current Reports on Form 8-K, Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K. Copies of these filings are available online at www.sec.gov, www.jnj.com or on request from Johnson & Johnson. The reader is also encouraged to review all other news releases and information available in the Investor Relations section of the company’s website at news releases, as well as www.factsabouttalc.com, www.factsaboutourprescriptionopioids.com, and www.LTLManagementInformation.com.

Regulatory

Biosense Webster Receives FDA Approval for Multiple Atrial Fibrillation Ablation Products to be Used in a Workflow Without Fluoroscopy

Press
Release

U.S. FDA Approves TALVEY (talquetamab-tgvs), a First-in-Class Bispecific Therapy for the Treatment of Patients with Heavily Pretreated Multiple Myeloma

Press
Release

European Commission Approves TALVEY (talquetamab), Janssen’s Novel Bispecific Therapy for the Treatment of Patients with Relapsed and Refractory Multiple Myeloma

Press
Release

European Commission Approves Reduced Dosing Frequency for Janssen’s Bispecific Antibody TECVAYLI (teclistamab)

Press
Release

Janssen Submits Application to the European Medicines Agency for RYBREVANT (amivantamab) in Combination with Chemotherapy for the First-Line Treatment of Adult Patients with Advanced Non-Small Cell Lung Cancer with Activating EGFR Exon 20 Insertion Mutations1

Press
Release

Janssen Submits Supplemental New Drug Application to the U.S. Food and Drug Administration Seeking Full Approval of BALVERSA (erdafitinib) for the Treatment of Patients with Locally Advanced or Metastatic Urothelial Carcinoma and Selected Fibroblast Growth Factor Receptor Gene Alterations

Press
Release

Janssen Submits Marketing Authorisation Application to the European Medicines Agency Seeking Approval of Erdafitinib for the Treatment of Patients with Locally Advanced or Metastatic Urothelial Cancer with Susceptible FGFR Alterations

Press
Release

U.S. FDA Approves AKEEGA (Niraparib and Abiraterone Acetate), the First-And-Only Dual Action Tablet for the Treatment of Patients with BRCA-Positive Metastatic Castration-Resistant Prostate Cancer

Press
Release

Data
Release

Janssen to Highlight Latest Research from Nipocalimab Clinical Development Program to Address Unmet Need in Myasthenia Gravis at AANEM 2023 Meeting1

Press
Release

Janssen Aims to Define New Standards of Care in the Treatment of Solid Tumor Cancers with Transformative Data Planned for Presentation at ESMO1

Press
Release

TREMFYA (guselkumab) Maintains Key Efficacy Endpoints Through Three Years for Adults with Moderately to Severely Active Crohn's Disease in a Phase 2 Study1

Press
Release

Janssen Highlights Latest Research for TREMFYA (guselkumab) and Investigational Targeted Oral Peptide JNJ-2113 in Moderate to Severe Plaque Psoriasis at the European Academy of Dermatology and Venereology (EADV) Congress1

Press
Release

Landmark Phase 3 MARIPOSA Study Meets Primary Endpoint Resulting in Statistically Significant and Clinically Meaningful Improvement in Progression-Free Survival for RYBREVANT (amivantamab-vmjw) plus Lazertinib Versus Osimertinib in Patients with EGFR-Mutated Non-Small Cell Lung Cancer

Press
Release

Phase 3 MARIPOSA-2 Study Meets Dual Primary Endpoint Resulting in Statistically Significant and Clinically Meaningful Improvement in Progression-Free Survival for RYBREVANT (amivantamab-vmjw) Plus Chemotherapy with and without Lazertinib versus Chemotherapy Alone in Patients with EGFR-Mutated Non-Small Cell Lung Cancer after Disease Progression on Osimertinib

Press
Release

Treatment with RYBREVANT (amivantamab-vmjw) and Lazertinib Plus Chemotherapy Showed Durable Progression-Free Survival in Patients with Previously Treated EGFR-Mutated Advanced Non-Small Cell Lung Cancer

Press
Release

Janssen to Highlight Latest Advances in Retina Portfolio at the European Society of Retina Specialists (EURETINA) 2023 Annual Meeting1

Press
Release

Product
Launch

Biosense Webster Launches the OPTRELL Mapping Catheter with TRUEref Technology for Mapping of Complex Cardiac Arrhythmias

Press
Release

Other

Johnson & Johnson Announces Final Results of Exchange Offer and Finalizes Separation of Kenvue Inc.

Press
Release

Johnson & Johnson Announces Updated Financials and 2023 Guidance Following Completion of the Kenvue Separation

Press
Release

Johnson & Johnson Marks New Era as Global Healthcare Company with Updated Visual Identity

Press
Release

1 Subsequent to the quarter


Full-Year 2023 Guidance:

Johnson & Johnson does not provide GAAP financial measures on a forward-looking basis because the company is unable to predict with reasonable certainty the ultimate outcome of legal proceedings, unusual gains and losses, acquisition-related expenses, and purchase accounting fair value adjustments without unreasonable effort. These items are uncertain, depend on various factors, and could be material to Johnson & Johnson's results computed in accordance with GAAP.

($ in Billions, except EPS)

October 2023

August 2023

Adjusted Operational Sales1,2,5

Change vs. Prior Year / Mid-point

7.2% – 7.7% / 7.5%

6.2% – 7.2% / 6.7%

Operational Sales2,5/ Mid-point

Change vs. Prior Year / Mid-point

$84.4B – $84.8B / $84.6B

8.5% – 9.0% / 8.7%

$83.6B – $84.4B / $84.0B

7.5% – 8.5% / 8.0%

Estimated Reported Sales3,5/ Mid-point

Change vs. Prior Year / Mid-point

$83.6B – $84.0B / $83.8B

7.5% – 8.0% / 7.7%

$83.2B – $84.0B / $83.6B

7.0% – 8.0% / 7.5%

 

 

 

Adjusted Operational EPS (Diluted)2,4/ Mid-point

Change vs. Prior Year / Mid-point

$10.02 – $10.08 / $10.05

12.2% – 12.8% / 12.5%

$9.90 – $10.00 / $9.95

11.0% – 12.0% / 11.5%

Adjusted EPS (Diluted)3,4 / Mid-point

Change vs. Prior Year / Mid-point

$10.07 – $10.13 / $10.10

12.7% – 13.3% / 13.0%

$10.00 – $10.10 / $10.05

12.0% – 13.0% / 12.5%

Average Shares Outstanding (Diluted)6

~2,557.2

~2,557.2

1


Non-GAAP financial measure; excludes the net impact of acquisitions and divestitures

2


Non-GAAP financial measure; excludes the impact of translational currency

3


Calculated using Euro Average Rate: October 2023 = $1.08 and July 2023 = $1.09 (Illustrative purposes only)

4


Non-GAAP financial measure; excludes intangible amortization expense and special items

5


Excludes COVID-19 Vaccine

6


Full Year 2023 Projected Average Shares Outstanding (Diluted) only reflects impact from the Kenvue exchange offer



Note: Percentages may have been rounded

Other modeling considerations will be provided on the webcast.

Webcast Information:

Johnson & Johnson will conduct a conference call with investors to discuss this earnings release today at 8:30 a.m., Eastern Time. A simultaneous webcast of the call for investors and other interested parties may be accessed by visiting the Johnson & Johnson website. A replay and podcast will be available approximately two hours after the live webcast in the Investor Relations section of the company's website at events-and-presentations.

About Johnson & Johnson:

At Johnson & Johnson, we believe health is everything. Our strength in healthcare innovation empowers us to build a world where complex diseases are prevented, treated, and cured, where treatments are smarter and less invasive, and solutions are personal. Through our expertise in Innovative Medicine and MedTech, we are uniquely positioned to innovate across the full spectrum of healthcare solutions today to deliver the breakthroughs of tomorrow, and profoundly impact health for humanity. Learn more at https://www.jnj.com/.

Non-GAAP Financial Measures:

* “Operational sales growth” excluding the impact of translational currency, “adjusted operational sales growth” excluding the net impact of acquisitions and divestitures and translational currency, as well as “adjusted net earnings”, “adjusted diluted earnings per share” and “adjusted operational diluted earnings per share” excluding after-tax intangible amortization expense and special items, are non-GAAP financial measures and should not be considered replacements for, and should be read together with, the most comparable GAAP financial measures. Except for guidance measures, reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the accompanying financial schedules of the earnings release and the Investor Relations section of the company's website at quarterly results.

Copies of the financial schedules accompanying this earnings release are available on the company’s website at quarterly results. These schedules include supplementary sales data, a condensed consolidated statement of earnings, reconciliations of non-GAAP financial measures, and sales of key products/franchises. Additional information on Johnson & Johnson, including adjusted income before tax by segment, an Innovative Medicine pipeline of selected compounds in late stage development and a copy of today’s earnings call presentation can also be found in the Investor Relations section of the company's website at quarterly results.

Note to Investors Concerning Forward-Looking Statements:

This press release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things: future operating and financial performance, product development, and market position and business strategy. The reader is cautioned not to rely on these forward-looking statements. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the expectations and projections of Johnson & Johnson. Risks and uncertainties include, but are not limited to: economic factors, such as interest rate and currency exchange rate fluctuations; competition, including technological advances, new products and patents attained by competitors; challenges inherent in new product research and development, including uncertainty of clinical success and obtaining regulatory approvals; uncertainty of commercial success for new and existing products; challenges to patents; the impact of patent expirations; the ability of the Company to successfully execute strategic plans, including restructuring plans; the impact of business combinations and divestitures; manufacturing difficulties or delays, internally or within the supply chain; product efficacy or safety concerns resulting in product recalls or regulatory action; significant adverse litigation or government action, including related to product liability claims; changes to applicable laws and regulations, including tax laws and global health care reforms; trends toward health care cost containment; changes in behavior and spending patterns of purchasers of health care products and services; financial instability of international economies and legal systems and sovereign risk; increased scrutiny of the health care industry by government agencies; the Company’s ability to realize the anticipated benefits from the separation of the Company’s Consumer Health business; and the New Consumer Health Company’s ability to succeed as a standalone publicly traded company. A further list and descriptions of these risks, uncertainties and other factors can be found in Johnson & Johnson’s Annual Report on Form 10-K for the fiscal year ended January 1, 2023, including in the sections captioned “Cautionary Note Regarding Forward-Looking Statements” and “Item 1A. Risk Factors,” and in Johnson & Johnson’s subsequent Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission. Copies of these filings are available online at www.sec.gov, www.jnj.com or on request from Johnson & Johnson. Any forward-looking statement made in this release speaks only as of the date of this release. Johnson & Johnson does not undertake to update any forward-looking statement as a result of new information or future events or developments.

Johnson & Johnson and Subsidiaries












Supplementary Sales Data































 
(Unaudited; Dollars in Millions)

THIRD QUARTER


NINE MONTHS


 

 

 

 

Percent Change


 

 

 

 

Percent Change


2023

 

2022

 

Total

 

Operations

 

Currency


2023

 

2022

 

Total

 

Operations

 

Currency

Sales to customers by


















segment of business





































 
Innovative Medicine (1,2)


















U.S.

 

8,249


7,438


10.9

 


10.9

 


-

 


 

23,090


21,229


8.8

 


8.8


-

 

International

 

5,644


5,776


(2.3

)


(4.3

)


2.0

 


 

17,947


18,171


(1.2

)


0.8


(2.0

)


 

13,893


13,214


5.1

 


4.3

 


0.8

 


 

41,037


39,400


4.2

 


5.1


(0.9

)




















 
Innovative Medicine excluding COVID-19 Vaccine (1,2)


















U.S.

 

8,249


7,438


10.9

 


10.9

 


-

 


 

23,090


21,109


9.4

 


9.4


-

 

International

 

5,603


5,287


5.9

 


4.3

 


1.6

 


 

16,874


16,801


0.4

 


2.7


(2.3

)


 

13,852


12,725


8.9

 


8.2

 


0.7

 


 

39,964


37,910


5.4

 


6.4


(1.0

)




















 
MedTech


















U.S.

 

3,747


3,356


11.6

 


11.6

 


-

 


 

11,345


9,932


14.2

 


14.2


-

 

International

 

3,711


3,426


8.3

 


9.2

 


(0.9

)


 

11,382


10,719


6.2

 


10.0


(3.8

)


 

7,458


6,782


10.0

 


10.4

 


(0.4

)


 

22,727


20,651


10.0

 


12.0


(2.0

)




















 
U.S.

 

11,996


10,794


11.1

 


11.1

 


-

 


 

34,435


31,161


10.5

 


10.5


-

 

International

 

9,355


9,202


1.6

 


0.7

 


0.9

 


 

29,329


28,890


1.5

 


4.2


(2.7

)

Worldwide

 

21,351


19,996


6.8

 


6.4

 


0.4

 


 

63,764


60,051


6.2

 


7.5


(1.3

)




















 
U.S.

 

11,996


10,794


11.1

 


11.1

 


-

 


 

34,435


31,041


10.9

 


10.9


-

 

International

 

9,314


8,713


6.9

 


6.3

 


0.6

 


 

28,256


27,520


2.7

 


5.5


(2.8

)

Worldwide excluding COVID-19 Vaccine (1)

$

21,310


19,507


9.2

 

%

9.0

 


0.2

 


$

62,691


58,561


7.1

 

%

8.4


(1.3

)




















 
Note: Percentages have been calculated using actual, non-rounded figures and, therefore, may not recalculate precisely.











 
(1) Refer to supplemental sales reconciliation schedule
(2) Previously referred to as Pharmaceutical
Johnson & Johnson and Subsidiaries









Supplementary Sales Data




























 
(Unaudited; Dollars in Millions)

THIRD QUARTER

 

NINE MONTHS


 

 

 

 

Percent Change

 

 

 

 

 

Percent Change


2023

 

2022

 

Total

 

Operations

 

Currency

 

2023

 

2022

 

Total

 

Operations

 

Currency

Sales to customers by


















geographic area





































 
U.S.

$

11,996


10,794


11.1

 

%

11.1

 


-

 


$

34,435


31,161


10.5

 

%

10.5

 


-

 




















 
Europe

 

4,727


4,844


(2.4

)


(7.8

)


5.4

 


 

15,448


15,540


(0.6

)


(1.0

)


0.4

 

Western Hemisphere excluding U.S.

 

1,171


1,059


10.5

 


12.8

 


(2.3

)


 

3,383


3,084


9.7

 


15.0

 


(5.3

)

Asia-Pacific, Africa

 

3,457


3,299


4.8

 


9.4

 


(4.6

)


 

10,498


10,266


2.2

 


8.7

 


(6.5

)

International

 

9,355


9,202


1.6

 


0.7

 


0.9

 


 

29,329


28,890


1.5

 


4.2

 


(2.7

)




















 
Worldwide

$

21,351


19,996


6.8

 

%

6.4

 


0.4

 


$

63,764


60,051


6.2

 

%

7.5

 


(1.3

)




















 
Note: Percentages have been calculated using actual, non-rounded figures and, therefore, may not recalculate precisely.
Johnson & Johnson and Subsidiaries








Condensed Consolidated Statement of Earnings

















 
(Unaudited; in Millions Except Per Share Figures) THIRD QUARTER









 

2023

 

2022

 

Percent


 

 

Percent

 

 

 

Percent

 

Increase


Amount

 

to Sales

 

Amount

 

to Sales

 

(Decrease)

Sales to customers

$

21,351

 


100.0

 


$

19,996

 


100.0

 


6.8

 

Cost of products sold

 

6,606

 


30.9

 


 

6,172

 


30.9

 


7.0

 

Gross Profit

 

14,745

 


69.1

 


 

13,824

 


69.1

 


6.7

 

Selling, marketing and administrative expenses

 

5,400

 


25.3

 


 

4,975

 


24.9

 


8.5

 

Research and development expense

 

3,447

 


16.2

 


 

3,485

 


17.4

 


(1.1

)

In-process research and development impairments

 

206

 


1.0

 


 

-

 


-

 



Interest (income) expense, net

 

(182

)


(0.8

)


 

(99

)


(0.5

)



Other (income) expense, net

 

499

 


2.3

 


 

226

 


1.1

 



Restructuring

 

158

 


0.7

 


 

65

 


0.3

 



Earnings before provision for taxes on income

 

5,217

 


24.4

 


 

5,172

 


25.9

 


0.9

 

Provision for taxes on income

 

908

 


4.2

 


 

862

 


4.3

 


5.3

 

Net earnings from Continuing Operations

$

4,309

 


20.2

 


$

4,310

 


21.6

 


0.0

 

Net earnings from Discontinued Operations, net of tax

 

21,719

 




 

148

 





Net earnings

$

26,028

 




$

4,458

 














 
Net earnings per share (Diluted) from Continuing Operations

$

1.69

 




$

1.62

 




4.3

 

Net earnings per share (Diluted) from Discontinued Operations

$

8.52

 




$

0.06

 














 
Average shares outstanding (Diluted)

 

2,549.7

 




 

2,661.3

 














 
Effective tax rate from Continuing Operations

 

17.4

 

%



 

16.7

 

%













 
Adjusted earnings from Continuing Operations before provision for taxes and net earnings (1)





Earnings before provision for taxes on income from Continuing Operations

$

8,033

 


37.6

 


$

7,060

 


35.3

 


13.8

 

Net earnings from Continuing Operations

$

6,777

 


31.7

 


$

5,938

 


29.7

 


14.1

 

Net earnings per share (Diluted) from Continuing Operations

$

2.66

 




$

2.23

 




19.3

 

Effective tax rate from Continuing Operations

 

15.6

 

%



 

15.9

 

%













 
(1) See Reconciliation of Non-GAAP Financial Measures.








Johnson & Johnson and Subsidiaries








Condensed Consolidated Statement of Earnings

















 
(Unaudited; in Millions Except Per Share Figures) NINE MONTHS









 

2023

 

2022

 

Percent


 

 

Percent

 

 

 

Percent

 

Increase


Amount

 

to Sales

 

Amount

 

to Sales

 

(Decrease)

Sales to customers

$

63,764

 


100.0

 


$

60,051

 


100.0

 


6.2

 

Cost of products sold

 

19,755

 


31.0

 


 

18,512

 


30.8

 


6.7

 

Gross Profit

 

44,009

 


69.0

 


 

41,539

 


69.2

 


5.9

 

Selling, marketing and administrative expenses

 

15,702

 


24.6

 


 

14,907

 


24.8

 


5.3

 

Research and development expense

 

10,605

 


16.6

 


 

10,425

 


17.4

 


1.7

 

In-process research and development impairments

 

255

 


0.4

 


 

610

 


1.0

 



Interest (income) expense, net

 

(277

)


(0.4

)


 

(137

)


(0.2

)



Other (income) expense, net

 

7,055

 


11.1

 


 

15

 


0.0

 



Restructuring

 

433

 


0.6

 


 

200

 


0.4

 



Earnings before provision for taxes on income

 

10,236

 


16.1

 


 

15,519

 


25.8

 


(34.0

)

Provision for taxes on income

 

1,042

 


1.7

 


 

2,376

 


3.9

 


(56.1

)

Net earnings from Continuing Operations

$

9,194

 


14.4

 


$

13,143

 


21.9

 


(30.0

)

Net earnings from Discontinued Operations, net of tax

 

21,910

 




 

1,278

 





Net earnings

$

31,104

 




$

14,421

 














 
Net earnings per share (Diluted) from Continuing Operations

$

3.53

 




$

4.93

 




(28.4

)

Net earnings per share (Diluted) from Discontinued Operations

$

8.42

 




$

0.48

 














 
Average shares outstanding (Diluted)

 

2,603.4

 




 

2,667.5

 














 
Effective tax rate from Continuing Operations

 

10.2

 

%



 

15.3

 

%













 
Adjusted earnings from continuing operations before provision for taxes and net earnings (1)





Earnings before provision for taxes on income from Continuing Operations

$

23,574

 


37.0

 


$

21,491

 


35.8

 


9.7

 

Net earnings from Continuing Operations

$

19,847

 


31.1

 


$

18,364

 


30.6

 


8.1

 

Net earnings per share (Diluted) from Continuing Operations

$

7.62

 




$

6.89

 




10.6

 

Effective tax rate from Continuing Operations

 

15.8

 

%



 

14.6

 

%













 
(1) See Reconciliation of Non-GAAP Financial Measures.
Johnson & Johnson and Subsidiaries







Reconciliation of Non-GAAP Financial Measures
















 



Third Quarter

 

Nine Months Ended


(Dollars in Millions Except Per Share Data)

2023

 

2022

 

2023

 

2022


Net Earnings from Continuing Operations, after tax- as reported

$

4,309

 


$

4,310

 


$

9,194

 


$

13,143

 










 

Pre-tax Adjustments








Litigation related

 

(51

)


 

219

 


 

6,986

 


 

604

 


Intangible Asset Amortization expense

 

1,132

 


 

958

 


 

3,384

 


 

2,967

 


COVID-19 Vaccine related costs 1

 

44

 


 

377

 


 

653

 


 

653

 


Restructuring related 2

 

384

 


 

92

 


 

659

 


 

253

 


Medical Device Regulation 3

 

74

 


 

78

 


 

223

 


 

208

 


Acquisition, integration and divestiture related

 

22

 


 

-

 


 

102

 


 

-

 


(Gains)/losses on securities

 

1,005

 


 

164

 


 

1,076

 


 

684

 


IPR&D impairments

 

206

 


 

-

 


 

255

 


 

610

 


Other

 

-

 


 

-

 


 

-

 


 

(7

)










 

Tax Adjustments








Tax impact on special item adjustments 4

 

(482

)


 

(312

)


 

(2,769

)


 

(900

)


Tax legislation and other tax related

 

134

 


 

52

 


 

84

 


 

149

 


Adjusted Net Earnings from Continuing Operations, after tax

$

6,777

 


$

5,938

 


$

19,847

 


$

18,364

 


Average shares outstanding (Diluted)

 

2,549.7

 


 

2,661.3

 


 

2,603.4

 


 

2,667.5

 


Adjusted net earnings per share from Continuing Operations (Diluted)

$

2.66

 


$

2.23

 


$

7.62

 


$

6.89

 


Operational adjusted net earnings per share from Continuing Operations (Diluted)

$

2.54

 




$

7.60

 





Notes:



1


COVID-19 Vaccine related costs include remaining commitments and obligations, including external manufacturing network exit costs and required clinical trial expenses, associated with the Company's completion of its COVID-19 vaccine contractual commitments.

2


In fiscal 2023, the company completed a prioritization of its research and development (R&D) investment within the Innovative Medicine segment to focus on the most promising medicines with the greatest benefit to patients. This resulted in the exit of certain programs within therapeutic areas. The R&D program exits are primarily in infectious diseases and vaccines including the discontinuation of its respiratory syncytial virus (RSV) adult vaccine program, hepatitis and HIV development. The restructuring expenses of $149 million in the quarter ($424 million Q3 YTD) include the termination of partnered and non-partnered program costs and asset impairments.


In the third quarter of 2023, the company initiated a restructuring program of its Orthopaedics franchise within the MedTech segment to streamline operations by exiting certain markets, product lines and distribution network arrangements. The restructuring expense in the quarter of $235 million primarily includes inventory and instrument reserves related to the market and product exits.

3


European Medical Device Regulation (MDR) costs represent one-time compliance costs for the Company’s previously registered products. MDR is a replacement of the existing European Medical Devices Directive regulatory framework, and manufacturers of currently marketed medical devices were required to comply with EU MDR beginning in May 2021. The Company considers the adoption of EU MDR to be a significant one-time regulatory change and is not indicative of on-going operations. The Company has excluded only external third-party regulatory and consulting costs from its MedTech operating segments' measures of profit and loss used for making operating decisions and assessing performance which is expected to be completed during 2024.

4


The tax impact related to special item adjustments reflects the current and deferred income taxes associated with the above pre-tax special items in arriving at adjusted earnings.
Johnson & Johnson and Subsidiaries
Reconciliation of Non-GAAP Financial Measure






 
Adjusted Operational Sales Growth
THIRD QUARTER 2023 ACTUAL vs. 2022 ACTUAL
     
Segments






 


Innovative Medicine
MedTech
Total







 
WW As Reported

5.1

%


10.0

%


6.8

%

U.S.

10.9

%


11.6

%


11.1

%

International

(2.3

)%


8.3

%


1.6

%







 
WW Currency

0.8

 


(0.4

)


0.4

 

U.S.

-

 


-

 


-

 

International

2.0

 


(0.9

)


0.9

 







 
WW Operational

4.3

%


10.4

%


6.4

%

U.S.

10.9

%


11.6

%


11.1

%

International

(4.3

)%


9.2

%


0.7

%







 
Abiomed


(4.6

)


(1.6

)

U.S.


(7.6

)


(2.3

)

International


(1.7

)


(0.6

)







 
All Other Acquisitions and Divestitures

0.1

 


0.2

 


0.1

 

U.S.

0.0

 


0.3

 


0.1

 

International

0.2

 


0.1

 


0.2

 







 
WW Adjusted Operational

4.4

%


6.0

%


4.9

%

U.S.

10.9

%


4.3

%


8.9

%

International

(4.1

)%


7.6

%


0.3

%







 
Note: Percentages are based on actual, non-rounded figures and may not sum
Johnson & Johnson and Subsidiaries
Reconciliation of Non-GAAP Financial Measure






 
Adjusted Operational Sales Growth
NINE MONTHS 2023 ACTUAL vs. 2022 ACTUAL
    
Segments






 


Innovative Medicine
MedTech
Total






 
WW As Reported

4.2

%


10.0

%


6.2

%

U.S.

8.8

%


14.2

%


10.5

%

International

(1.2

)%


6.2

%


1.5

%







 
WW Currency

(0.9

)


(2.0

)


(1.3

)

U.S.

-

 


-

 


-

 

International

(2.0

)


(3.8

)


(2.7

)







 
WW Operational

5.1

%


12.0

%


7.5

%

U.S.

8.8

%


14.2

%


10.5

%

International

0.8

%


10.0

%


4.2

%







 
Abiomed


(4.7

)


(1.6

)

U.S.


(7.9

)


(2.5

)

International


(1.6

)


(0.6

)







 
All Other Acquisitions and Divestitures

0.1

 


0.1

 


0.1

 

U.S.

0.0

 


0.1

 


0.0

 

International

0.2

 


0.0

 


0.1

 







 
WW Adjusted Operational

5.2

%


7.4

%


6.0

%

U.S.

8.8

%


6.4

%


8.0

%

International

1.0

%


8.4

%


3.7

%







 
Note: Percentages are based on actual, non-rounded figures and may not sum

REPORTED SALES vs. PRIOR PERIOD ($MM)




REPORTED SALES vs. PRIOR PERIOD ($MM)

THIRD QUARTER


NINE MONTHS






% Change





% Change
INNOVATIVE MEDICINE SEGMENT (2,3,4)

2023


2022

Reported

Operational (1)

Currency




2023


2022

Reported

Operational (1)

Currency

















 
IMMUNOLOGY















US

$

3,193


2,876

11.0

%

11.0

%

-

 




$

8,506


8,230

3.3

%

3.3

%

-

 

Intl

 

1,656


1,411

17.4

%

15.2

%

2.2

%




 

4,951


4,587

7.9

%

10.3

%

-2.4

%

WW

 

4,849


4,287

13.1

%

12.4

%

0.7

%




 

13,457


12,817

5.0

%

5.9

%

-0.9

%

REMICADE















US

 

296


350

-15.4

%

-15.4

%

-

 




 

849


1,099

-22.7

%

-22.7

%

-

 

US Exports (5)

 

38


39

-2.5

%

-2.5

%

-

 




 

112


163

-31.3

%

-31.3

%

-

 

Intl

 

127


169

-25.1

%

-24.3

%

-0.8

%




 

449


606

-25.9

%

-23.0

%

-2.9

%

WW

 

461


558

-17.4

%

-17.1

%

-0.3

%




 

1,410


1,868

-24.5

%

-23.6

%

-0.9

%

SIMPONI / SIMPONI ARIA















US

 

310


298

3.9

%

3.9

%

-

 




 

866


886

-2.3

%

-2.3

%

-

 

Intl

 

319


248

29.1

%

30.2

%

-1.1

%




 

829


797

4.1

%

8.6

%

-4.5

%

WW

 

629


545

15.3

%

15.8

%

-0.5

%




 

1,695


1,682

0.8

%

2.9

%

-2.1

%

STELARA















US

 

1,912


1,655

15.5

%

15.5

%

-

 




 

5,180


4,766

8.7

%

8.7

%

-

 

Intl

 

951


794

19.9

%

16.2

%

3.7

%




 

2,925


2,571

13.8

%

15.5

%

-1.7

%

WW

 

2,864


2,449

16.9

%

15.8

%

1.1

%




 

8,105


7,336

10.5

%

11.1

%

-0.6

%

TREMFYA















US

 

634


530

19.6

%

19.6

%

-

 




 

1,490


1,303

14.4

%

14.4

%

-

 

Intl

 

258


200

29.0

%

26.3

%

2.7

%




 

747


613

21.9

%

24.0

%

-2.1

%

WW

 

891


729

22.2

%

21.5

%

0.7

%




 

2,237


1,916

16.8

%

17.4

%

-0.6

%

OTHER IMMUNOLOGY















US

 

2


5

-47.1

%

-47.1

%

-

 




 

9


14

-36.1

%

-36.1

%

-

 

Intl

 

0


0

-

 

-

 

-

 




 

0


0

-

 

-

 

-

 

WW

 

2


5

-47.1

%

-47.1

%

-

 




 

9


14

-36.1

%

-36.1

%

-

 

INFECTIOUS DISEASES















US

 

360


390

-7.8

%

-7.8

%

-

 




 

1,147


1,266

-9.4

%

-9.4

%

-

 

Intl

 

500


905

-44.8

%

-50.7

%

5.9

%




 

2,420


2,642

-8.4

%

-9.3

%

0.9

%

WW

 

859


1,295

-33.6

%

-37.8

%

4.2

%




 

3,566


3,908

-8.7

%

-9.3

%

0.6

%

COVID-19 VACCINE















US

 

0


0

-

 

-

 

-

 




 

0


120

* *

-

 

Intl

 

41


489

-91.5

%

-97.8

%

6.3

%




 

1,073


1,370

-21.6

%

-23.0

%

1.4

%

WW

 

41


489

-91.5

%

-97.8

%

6.3

%




 

1,073


1,490

-27.9

%

-29.2

%

1.3

%

EDURANT / rilpivirine















US

 

9


9

10.2

%

10.2

%

-

 




 

26


27

-0.5

%

-0.5

%

-

 

Intl

 

287


237

21.4

%

13.4

%

8.0

%




 

816


691

18.2

%

16.4

%

1.8

%

WW

 

297


245

21.0

%

13.3

%

7.7

%




 

843


718

17.5

%

15.8

%

1.7

%

PREZISTA / PREZCOBIX / REZOLSTA / SYMTUZA















US

 

345


372

-7.3

%

-7.3

%

-

 




 

1,105


1,096

0.9

%

0.9

%

-

 

Intl

 

102


112

-9.5

%

-15.0

%

5.5

%




 

310


354

-12.5

%

-13.0

%

0.5

%

WW

 

447


485

-7.8

%

-9.0

%

1.2

%




 

1,415


1,450

-2.4

%

-2.5

%

0.1

%

OTHER INFECTIOUS DISEASES















US

 

5


10

-42.7

%

-42.7

%

-

 




 

15


24

-35.5

%

-35.5

%

-

 

Intl

 

69


68

2.0

%

5.5

%

-3.5

%




 

220


228

-3.4

%

0.8

%

-4.2

%

WW

 

74


77

-3.6

%

-0.5

%

-3.1

%




 

235


251

-6.4

%

-2.6

%

-3.8

%

















 
















 
















 
















 

REPORTED SALES vs. PRIOR PERIOD ($MM)




REPORTED SALES vs. PRIOR PERIOD ($MM)

THIRD QUARTER


NINE MONTHS






% Change





% Change


2023


2022

Reported

Operational (1)

Currency

 

 

 

2023


2022

Reported

Operational (1)

Currency

NEUROSCIENCE















US

 

1,036


919

12.7

%

12.7

%

-

 




 

3,043


2,658

14.5

%

14.5

%

-

 

Intl

 

706


763

-7.4

%

-5.1

%

-2.3

%




 

2,296


2,498

-8.1

%

-4.2

%

-3.9

%

WW

 

1,742


1,681

3.6

%

4.6

%

-1.0

%




 

5,339


5,156

3.5

%

5.4

%

-1.9

%

CONCERTA / Methylphenidate















US

 

57


41

38.1

%

38.1

%

-

 




 

191


114

67.4

%

67.4

%

-

 

Intl

 

133


117

13.6

%

15.5

%

-1.9

%




 

412


362

13.8

%

19.0

%

-5.2

%

WW

 

189


158

20.0

%

21.4

%

-1.4

%




 

603


476

26.7

%

30.7

%

-4.0

%

INVEGA SUSTENNA / XEPLION /
INVEGA TRINZA / TREVICTA
















US

 

730


684

6.8

%

6.8

%

-

 




 

2,164


2,036

6.3

%

6.3

%

-

 

Intl

 

299


348

-14.0

%

-14.4

%

0.4

%




 

940


1,097

-14.3

%

-11.9

%

-2.4

%

WW

 

1,029


1,031

-0.2

%

-0.3

%

0.1

%




 

3,104


3,132

-0.9

%

-0.1

%

-0.8

%

SPRAVATO















US

 

154


88

75.1

%

75.1

%

-

 




 

409


223

83.1

%

83.1

%

-

 

Intl

 

29


12

* * *


 

74


32

* * *
WW

 

183


100

82.1

%

81.0

%

1.1

%




 

483


255

88.8

%

88.7

%

0.1

%

OTHER NEUROSCIENCE















US

 

94


106

-11.3

%

-11.3

%

-

 




 

278


285

-2.3

%

-2.3

%

-

 

Intl

 

245


286

-13.9

%

-7.8

%

-6.1

%




 

870


1,007

-13.5

%

-8.5

%

-5.0

%

WW

 

340


393

-13.2

%

-8.7

%

-4.5

%




 

1,149


1,293

-11.0

%

-7.1

%

-3.9

%

ONCOLOGY















US

 

2,219


1,812

22.5

%

22.5

%

-

 




 

6,177


5,073

21.8

%

21.8

%

-

 

Intl

 

2,313


2,252

2.7

%

0.7

%

2.0

%




 

6,865


6,983

-1.7

%

0.3

%

-2.0

%

WW

 

4,533


4,064

11.5

%

10.4

%

1.1

%




 

13,043


12,056

8.2

%

9.3

%

-1.1

%

CARVYKTI















US

 

140


55

* *

-

 




 

324


79

* *

-

 

Intl

 

12


-

* *

-

 




 

17


-

* *

-

 

WW

 

152


55

* *

-

 




 

341


79

* *

-

 

DARZALEX















US

 

1,369


1,097

24.8

%

24.8

%

-

 




 

3,882


3,071

26.4

%

26.4

%

-

 

Intl

 

1,130


955

18.3

%

16.0

%

2.3

%




 

3,312


2,823

17.3

%

19.7

%

-2.4

%

WW

 

2,499


2,052

21.8

%

20.7

%

1.1

%




 

7,194


5,894

22.1

%

23.2

%

-1.1

%

ERLEADA















US

 

288


254

12.9

%

12.9

%

-

 




 

778


693

12.2

%

12.2

%

-

 

Intl

 

342


235

45.8

%

42.3

%

3.5

%




 

961


647

48.7

%

51.0

%

-2.3

%

WW

 

631


490

28.7

%

27.0

%

1.7

%




 

1,740


1,340

29.8

%

30.9

%

-1.1

%

IMBRUVICA















US

 

264


353

-25.2

%

-25.2

%

-

 




 

796


1,072

-25.8

%

-25.8

%

-

 

Intl

 

545


559

-2.5

%

-4.6

%

2.1

%




 

1,681


1,847

-9.0

%

-7.6

%

-1.4

%

WW

 

808


911

-11.3

%

-12.6

%

1.3

%




 

2,476


2,918

-15.2

%

-14.2

%

-1.0

%

ZYTIGA / abiraterone acetate















US

 

16


16

-2.8

%

-2.8

%

-

 




 

41


54

-24.9

%

-24.9

%

-

 

Intl

 

199


440

-54.9

%

-55.1

%

0.2

%




 

646


1,446

-55.3

%

-53.6

%

-1.7

%

WW

 

214


456

-53.0

%

-53.2

%

0.2

%




 

686


1,500

-54.2

%

-52.6

%

-1.6

%

OTHER ONCOLOGY















US

 

143


37

* *

-

 




 

357


104

* *

-

 

Intl

 

86


64

34.5

%

30.4

%

4.1

%




 

248


220

12.5

%

13.8

%

-1.3

%

WW

 

229


100

* * *


 

605


324

86.5

%

87.4

%

-0.9

%

















 
















 
















 
















 

REPORTED SALES vs. PRIOR PERIOD ($MM)




REPORTED SALES vs. PRIOR PERIOD ($MM)


THIRD QUARTER


NINE MONTHS



 

 

 

% Change




 

 

 

% Change



2023


2022

Reported

Operational (1)

Currency




2023


2022

Reported

Operational (1)

Currency

PULMONARY HYPERTENSION















US

 

680


604

12.6

%

12.6

%

-

 




 

1,964


1,736

13.1

%

13.1

%

-

 

Intl

 

274


247

10.5

%

11.7

%

-1.2

%




 

835


810

3.0

%

7.4

%

-4.4

%

WW

 

954


852

12.0

%

12.4

%

-0.4

%




 

2,798


2,547

9.9

%

11.3

%

-1.4

%

OPSUMIT















US

 

323


289

12.2

%

12.2

%

-

 




 

924


827

11.8

%

11.8

%

-

 

Intl

 

166


152

9.3

%

8.6

%

0.7

%




 

512


495

3.5

%

6.8

%

-3.3

%

WW

 

490


441

11.2

%

10.9

%

0.3

%




 

1,437


1,322

8.7

%

9.9

%

-1.2

%

UPTRAVI















US

 

336


283

18.9

%

18.9

%

-

 




 

978


824

18.7

%

18.7

%

-

 

Intl

 

66


50

30.9

%

33.8

%

-2.9

%




 

185


162

14.1

%

18.6

%

-4.5

%

WW

 

402


333

20.7

%

21.1

%

-0.4

%




 

1,163


986

18.0

%

18.7

%

-0.7

%

OTHER PULMONARY HYPERTENSION















US

 

20


33

-37.1

%

-37.1

%

-

 




 

61


86

-28.4

%

-28.4

%

-

 

Intl

 

42


46

-7.5

%

-2.1

%

-5.4

%




 

137


154

-10.5

%

-2.6

%

-7.9

%

WW

 

63


78

-19.8

%

-16.6

%

-3.2

%




 

199


239

-16.9

%

-11.8

%

-5.1

%

CARDIOVASCULAR / METABOLISM / OTHER















US

 

763


837

-8.8

%

-8.8

%

-

 




 

2,254


2,266

-0.5

%

-0.5

%

-

 

Intl

 

194


198

-2.1

%

-4.7

%

2.6

%




 

580


651

-10.8

%

-9.8

%

-1.0

%

WW

 

957


1,034

-7.5

%

-8.0

%

0.5

%




 

2,834


2,916

-2.8

%

-2.6

%

-0.2

%

XARELTO















US

 

625


689

-9.4

%

-9.4

%

-

 




 

1,840


1,806

1.9

%

1.9

%

-

 

Intl

 

-


-

-

 

-

 

-

 




 

-


-

-

 

-

 

-

 

WW

 

625


689

-9.4

%

-9.4

%

-

 




 

1,840


1,806

1.9

%

1.9

%

-

 

OTHER















US

 

139


147

-6.1

%

-6.1

%

-

 




 

414


459

-9.9

%

-9.9

%

-

 

Intl

 

194


198

-2.1

%

-4.7

%

2.6

%




 

580


651

-10.8

%

-9.8

%

-1.0

%

WW

 

332


345

-3.8

%

-5.3

%

1.5

%




 

994


1,110

-10.5

%

-9.8

%

-0.7

%

















 
TOTAL INNOVATIVE MEDICINE















US

 

8,249


7,438

10.9

%

10.9

%

-

 




 

23,090


21,229

8.8

%

8.8

%

-

 

Intl

 

5,644


5,776

-2.3

%

-4.3

%

2.0

%




 

17,947


18,171

-1.2

%

0.8

%

-2.0

%

WW

$

13,893


13,214

5.1

%

4.3

%

0.8

%




$

41,037


39,400

4.2

%

5.1

%

-0.9

%

















 
















 
See footnotes at end of schedule
























 
















 
















 

REPORTED SALES vs. PRIOR PERIOD ($MM)

 

 

 

REPORTED SALES vs. PRIOR PERIOD ($MM)


THIRD QUARTER

 

 

 

NINE MONTHS


 

 

 

 

% Change

 

 

 

 

 

 

% Change

MEDTECH SEGMENT (2,3)

 

2023

 

2022

Reported

Operational (1)

Currency

 

 

 

2023

 

2022

Reported

Operational (1)

Currency

















 
INTERVENTIONAL SOLUTIONS















US

$

891


547

63.0

%

63.0

%

-

 




$

2,662


1,566

70.0

%

70.0

%

-

 

Intl

 

667


513

29.9

%

32.2

%

-2.3

%




 

2,019


1,636

23.4

%

28.6

%

-5.2

%

WW

 

1,558


1,060

47.0

%

48.1

%

-1.1

%




 

4,681


3,202

46.2

%

48.9

%

-2.7

%

ELECTROPHYSIOLOGY















US

 

611


520

17.6

%

17.6

%

-

 




 

1,791


1,489

20.3

%

20.3

%

-

 

Intl

 

549


453

21.2

%

23.4

%

-2.2

%




 

1,658


1,454

14.0

%

19.2

%

-5.2

%

WW

 

1,161


973

19.3

%

20.3

%

-1.0

%




 

3,449


2,943

17.2

%

19.8

%

-2.6

%

ABIOMED















US

 

254


-

* *

-

 




 

790


-

* *

-

 

Intl

 

57


-

* *

-

 




 

176


-

* *

-

 

WW

 

311


-

* *

-

 




 

966


-

* *

-

 

OTHER INTERVENTIONAL SOLUTIONS















US

 

26


27

-3.2

%

-3.2

%

-

 




 

81


77

5.9

%

5.9

%

-

 

Intl

 

61


60

1.0

%

3.7

%

-2.7

%




 

186


181

2.2

%

7.2

%

-5.0

%

WW

 

87


87

-0.3

%

1.6

%

-1.9

%




 

267


258

3.3

%

6.8

%

-3.5

%

ORTHOPAEDICS















US

 

1,349


1,309

3.1

%

3.1

%

-

 




 

4,100


3,936

4.2

%

4.2

%

-

 

Intl

 

815


785

3.9

%

1.7

%

2.2

%




 

2,574


2,504

2.8

%

4.9

%

-2.1

%

WW

 

2,164


2,095

3.4

%

2.6

%

0.8

%




 

6,674


6,440

3.6

%

4.5

%

-0.9

%

HIPS















US

 

239


228

4.9

%

4.9

%

-

 




 

730


693

5.4

%

5.4

%

-

 

Intl

 

136


124

9.3

%

7.3

%

2.0

%




 

432


437

-1.0

%

1.1

%

-2.1

%

WW

 

375


352

6.5

%

5.8

%

0.7

%




 

1,162


1,129

2.9

%

3.8

%

-0.9

%

KNEES















US

 

207